Strategic Dualities and Business Model Innovation within SMEs

Abstract

Applying a business model approach, this paper explores how SMEs perceive, understand and deal with the range of strategic dualities that they face and how this may impact their business model innovation. Qualitative research was conducted using a sample of eight SMEs with the results analysed using content analysis. The findings suggest that SMEs address strategic dualities along four dimensions: degree of globalization (local vs. global), type of offering (individual experience vs. mass product), time orientation (short-term survival vs. long-term orientation), and modernity orientation (tradition vs. modern). It appears to be that SMEs do not recognize these dualities directly but are continuously trying to cope with the tensions they create, and that the whole process is biased by a strong link of SMEs to the local environment (i.e. terroir) that prevents radical innovation of business models. These findings are significant as they cast new insights into the strategic duality faced by SMEs and start to untangle the complex relationships between elements of the business model and SMEs’ local environments.